CONFERENCE PROCEEDING

Gödöllő, Hungary 4-7 May 2010

Media Sponsor:

Global Management Conference – Gödöllő, Hungary

04-07 May 2011

GLOBAL MANAGEMENT CONFERENCE

Conference proceeding

Gödöllő 2011 2

.

Global Management Conference – Gödöllő, Hungary

Edited by the Editorial Board Dr. Tov Assogbavi – Chairman of the Editorial Board Dr. László Vasa Dr. Henrietta Nagy

Published by Szent István University 2103 Gödöllő, Páter Károly utca 1.

Editor in charge Dr. László Vasa Dr. Henrietta Nagy

ISBN 978-963-269-233-3

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04-07 May 2011

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SCIENTIFIC BOARD Dr. László Villányi (Szent István University, Hungary)

Dr. Sara Alpisbayeva (Economic Research Institute,

Dr. László Guth (Szent István University, Hungary)

Kazakhstan)

Dr. Róbert Magda (Károly Róbert College, Hungary)

Dr. Ali Abishev (Kazakh Economic University named after

Dr. József Káposzta (Szent István University, Hungary)

Ryskulov, Kazakhstan)

Dr. Henrietta Nagy (Szent István University, Hungary)

Dr. Magdalena Hrabankova (South Bohemian University,

Dr. István Fehér (Szent István University, Hungary)

Czech Republik)

Dr. László Vasa (Szent István University, Hungary)

Dr. Dagmar Skodova Parmova (South Bohemian University,

Dr. Sándor J. Zsarnóczai (Szent István University, Hungary) Czech Republik) Dr. Tov Assogbavi (Laurentian University, Canada)

Dr. Olena Vinogradova (Ukraine)

Dr. Maurice Grezda (Laurentian University, Canada)

Dr. Alexander Stratan (Institute of Economics, Statistics and

Dr. Niar Hotniar (Gunadarma University, Indonesia)

Finance, Moldova)

Dr. Tengiz Urushadze (State Agrarian University, Georgia) Dr. Voicu Succala (Technical University of Cluj, Romania) Dr. Mikhail Fedorov (Ural State University of Economics,Dr. Russia)

Hanon

Barabaner

(Institute

of

Economics

and

management, Estonia)

Dr. Natalia Vlasova (Ural State University of Economics,Dr. Kiril Todorov (University of National and World Russia)

Economics, Bulgaria)

Dr. Elena Kurilova (Ural State University of Economics,Dr. Hanns Pichler (Wirtschaftsuniversität Wien, Austria) Russia)

Dr. Karl Viehe (George Washington University, USA)

Dr. Nadezda Jakovlevna

Kaliuzhnova (Irkutsk StateDr. Vardges Hovhannisyan (University of Wisconsin-

University, Russia)

Madison, USA)

Dr. Inna Antokhonova (East Siberian State TechnologicalDr. Berndt Hallier (European Retail Institute, Germany) Dr. Wolfgang Klenner (Ruhr Universität, Germany)

University, Russia) Dr.

Aigul

Toxanova

(Economic

Research

Institute,

Kazakhstan)

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EDITORIAL This Volume contains an extensive summary of most of the papers presented during the third annual international conference of Global Management (GM) Conference held in Gödöllő/Budapest, Hungary, May 04 – May 07, 2011 and focusing on ―Globalization, Sustainability and Development‖. This volume is part of the continuing efforts of Global Academic Network / CISRO Institute of Management to make available current research findings to practitioners and academics. The Global Management Conference (GM Conference) was established three years ago by CISRO Institute of Management as a forum dedicated to fostering and promoting global management studies for sustainable economic development. The GM conference, under the leadership of a program committee consisting of international scholars and practitioners, has become one of the respected forums for exchanges between academics and professionals. The conference aims:  To promote research pertaining to global management issues across the full spectrum of organizations;  To encourage integration and exchange of knowledge among academics and professionals worldwide;  To develop frameworks for a better understanding of the dynamics of globalization in the process of sharing knowledge and technologies aimed at sustainable development. The GM conference continues to evolve into a leading global conference since its launch, thanks to the immense support provided by many dedicated individuals and institutions. The objectives and far-reaching visions of the GM conference have generated interest and excitement among academics and practitioners around the world. The GM conference is indebted to all those responsible for this year‘s program, particularly those who served as reviewers and track chairs. Among members of the organizing committee, those representing Szent István University, are acknowledged for the excellent work coordinating arrangements for the conference venue, collaborating with our Hungarian partners, and assuring a memorable conference experience for participants. Special thanks are extended to Dr. László Vasa and Dr. Henrietta Nagy from Szent István University, Maurice Grzeda, from Laurentian University, Sébastien Azondékon from University of Québec in Outaouais (UQO), Dr. Komlan Zedzro from University of Quebec in Montreal (UQAM), Dr. Hotniar Siringoringo from Gunadarma University. Thanks also to the GM conference officers and Board of Directors. Our appreciation also extends to the authors of papers presented in the conference. The quality of papers submitted attests to the growing reputation of the GM conference. We would like to extend our personal thanks to Prof, Dr. László Villányi, Dean of the Faculty of Economics of Szent István University for his support. Special acknowledgement and thanks to our esteemed sponsors (Napi Gazdaság) for making this publication possible.

Dr. Tov Assogbavi, GM Conference Chair Prof, Laurentian University, President, CISRO Institute of Management

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CONTENTS ACCOUNTING ..................................................................................................................................................... 8 DONATIEN AVELÉ - GÉRARD FILLION ................................................................................................................. 9 SZILVIA MÉHESNÉ BEREK ................................................................................................................................. 25 AGRICULTURE MANAGEMENT .................................................................................................................. 30 DAGMAR ŠKODOVÁ - PARMOVÁ AND EVA CUDLÍNOVÁ .................................................................................. 31 ZSUZSANNA KASSAI – KRISZTIÁN RITTER – PÁL GODA .................................................................................... 44 LIGETVÁRI FERENC – ZSARNÓCZAI J. SÁNDOR – HAMED ABDOUSLAM ABDORHIM .......................................... 50 ANAR HATAMOV ............................................................................................................................................... 58 LIGETVÁRI, FERENC – ZSARNÓCZAI, J. SÁNDOR – KHALIF, ABDUSSALAM ASHOUR ......................................... 60 ZSARNÓCZAI, J. SÁNDOR – LIGETVÁRI, FERENC – KHALIF, ABDUSSALAM ASHOUR ......................................... 65 ZSARNÓCZAI J. SÁNDOR – GUTH LÁSZLÓ – MUGHRAM ALI YAHIA .................................................................. 71 ZSARNÓCZAI J. SÁNDOR – VASA LÁSZLÓ – MUBARAK RASHID AL BOIAININ ................................................... 77 VIRÁG SZABÓ – KINGA NAGYNÉ PÉRCSI ........................................................................................................... 84 LASZLO VASA.................................................................................................................................................... 88 ECONOMICS ...................................................................................................................................................... 98 LÁSZLÓ ATTILA - CSAPÓ ................................................................................................................................... 99 IFFATH SULTANA ............................................................................................................................................. 102 KAHRAMON SHAAKRAMOV ............................................................................................................................. 113 SZALAY ZSUZSANNA E. – DOBOS IMRE ........................................................................................................... 116 NADEZDA YA. KALIUZHNOVA ......................................................................................................................... 122 FINANCE, BANKING, INSURANCE ............................................................................................................ 124 BINAY BHUSHAN CHAKRABARTI - ORR BEN NATHEN..................................................................................... 125 E. SUSY SUHENDRA - TEDDY OSWARI ............................................................................................................. 141 FRED ROBINS ................................................................................................................................................... 148 LASZLO SZEMELYI........................................................................................................................................... 155 TOV ASSOGBAVI - JEAN-FRANÇOIS DÉMORÉ -KOMLAN SEDZRO .................................................................... 156 SAID ELFAKHANI – WAYNE MACKIE ............................................................................................................... 157 GENERAL PAPERS ......................................................................................................................................... 184 ALEXANDRU STRATAN - VICTORIA CLIPA ....................................................................................................... 185 MEHMET BASAR - TUĞBERK SECKIN - MELIK KAMISLI .................................................................................. 191 HENRIETTA NAGY – JÓZSEF KÁPOSZTA – ADRIENN NAGY – KITTI KOLLÁR ................................................... 201 KITTI KOLLÁR – JÓZSEF KÁPOSZTA – ADRIENN NAGY – HENRIETTA NAGY ................................................... 206 IVETT SZÉLES .................................................................................................................................................. 211 GLOBAL WARMING AND ENERGY .......................................................................................................... 218 CSEGŐDI, TIBOR LÁSZLÓ - FARKAS, TIBOR ..................................................................................................... 219 CSABA FOGARASSY ......................................................................................................................................... 228 HEALTH CARE MANAGEMENT ................................................................................................................. 236 BRIDGET UYOYOU IMONIKEBE ........................................................................................................................ 237 SALTANAT ESENTAEVNA ORYNBASSAROVA ................................................................................................... 238 INFORMATION TECHNOLOGY.................................................................................................................. 242 TAMAS KOPLYAY - LISA SANCHEZ - DOUGLAS LLOYD ................................................................................... 243 MANAGEMENT ............................................................................................................................................... 264

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AMINU MAMMAN - KOJO SAFFU - ANGELA LEMAIRE ..................................................................................... 265 ANATOLY K.KAZANTSEV - IRINA A.NIKITINA................................................................................................. 274 CELAL HAKAN KAGNICIOGLU ......................................................................................................................... 284 DOROTHY ROULY HARATUA PANDJAITAN - IR. HOTNIAR SIRINGORINGO ....................................................... 292 FARSHAD MOSHIRI - HASHEM PAZHOUHESH ................................................................................................... 301 GOU-FONG LIAW ............................................................................................................................................. 306 JANOS FEHER - JOZSEF POOR - JAMES PORTWOOD .......................................................................................... 317 JO RHODES - PETER LOK - DAVID WALTERS ................................................................................................... 323 JÓZSEF POÓR - ZSUZSA KAROLINY - FERENC FARKAS - KATALIN DOBRAI - ALLEN ENGLE ............................ 334 KAZIMIERZ ZARAS - BRYAN BOUDREAU-TRUDEL - ANDRÉ GBODOSSOU ....................................................... 347 LIBENA KANTNEROVA ..................................................................................................................................... 348 MAREK PRYMON ............................................................................................................................................. 359 MAURICE GRZEDA........................................................................................................................................... 365 MEGHA JAIN - ANGELINA HANH NHAT LE - MICHAEL CHIH-HUNG WANG - JULIAN MING SUNG CHENG ...... 374 MOHAMMAD SHADAB KHALIL - JULIA YING-CHAO LIN - JULIAN MING-SUNG CHENG - JOY HUI-TING XIAO 375 MUKASHEV TIMUR ABUGALIEVICH - NABIYEV ERBOZ NABIEVICH ................................................................ 376 NORIHIKO TAKEUCHI - TOMOKAZU TAKEUCHI ............................................................................................... 380 PROJECT MANAGEMENT ........................................................................................................................... 395 AINA IRINTSOA MARILALA RAMAHAIMANANA - SÉBASTIEN H. AZONDÉKON ................................................ 396 THEODOROS KOSMANIS - SOFIE KROL - MARK PECQUEUR - ANTOANETA DOBREVA - GEORGI GEORGIEV VASKO DOBREV .............................................................................................................................................. 403 SME MANAGEMENT ..................................................................................................................................... 407 ABDELHADI NAJI ............................................................................................................................................. 408 ALIDOU OUEDRAOGO ...................................................................................................................................... 420 VIVI KOFFI ...................................................................................................................................................... 428 TOURISM AND HOSPITALITY MANAGEMENT ..................................................................................... 443 JÓZSEF KÁPOSZTA – HENRIETTA NAGY – ADRIENN NAGY – KITTI KOLLÁR ................................................... 444 S.A. KALENOVA .............................................................................................................................................. 452

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ANALYSIS OF FINANCIAL PERFORMANCE INDONESIA FOREIGN EXCHANGE AND NON-FOREIGN EXCHANGE BANKS E. Susy Suhendra - Teddy Oswari ABSTRACT This paper analyzes the financial performance of foreign exchange bank and non-foreign exchange banks in Indonesia through financial data during the period 2000-2009. Concentrate on the discussion of the variable performance indicators, namely the banking is Capital Adequacy Ratio (CAR), Return on Equity (ROE), Loan to Deposit Ratio (LDR), Non Performing Loan (NPL), Earning Ability (EA) and Return on Asset (ROA). The average ROA is 3.71%, the lowest ROA of -7.11% is owned by Permata bank ROA and the highest 98.72% owned by the bank Ganesha. The average ROE is 13.45%, with the lowest ROE of -14.76 Ganesha owned by the bank and the highest ROE 25.66% owned by Commerce Bank. LDR average is 70.14%, the lowest LDR of 28.00% is owned by Permata and the bank's highest LDR 188.90% owned by Eksekutif International Bank. The average CAR is 19.09%, with the lowest CAR of 9.95% is owned by the bank's highest CAR Mayora Bank and 24.21% owned by Bumiputera Indonesia Bank. The average EA is 86.01%, the lowest EA of 83.12% is owned by Kesawan bank EA and the highest 88.02% owned by the Central Asia bank. The average NPL is 3.8%, the lowest NPL of 4.87% is owned by Swadesi bank ROA and the highest 6.66% owned by the Kesawan bank. Less successful foreign bank in its performance due to increase assets and capital is not managed optimally which can be seen from the CAR, ROE, LDR, NPL, EA, ROA is not in accordance with the standards required by Bank Indonesia, that is ≥ 12% (CAR), ≥ 12% (ROE ), 85% - 110% (LDR), ≥ 5% (NPL), ≥ 90% (EA), ≥ 2% (ROA). Changes can be made by foreign banks is to take advantage of the excess of assets held, so that they can increase profit earnings, as well as the performance in general anticipate bad debts in the previous period to be more careful in allocating the excess of assets owned. KEYWORDS foreign exchange bank, non-foreign exchange bank, financial performance

INTRODUCTION Indonesian banking world has experienced many changes from time to time. This change is caused by other than the internal development of the banking sector and the economy outside the banking sector, such as the real sector, technological, political, legal, social, macroeconomic and competition. In development activities, fund management is almost entirely done by the financial institutions either bank financial institutions, financial institutions are not banks and financial institutions insurance. But that looks more dominant financial institution is a bank. Growth in the number of banks in 2006 according to the annual report of Bank Indonesia's 128 banks appeared to bring the economy to a new stage in its development. The amount of money in circulation at the end of the year 2000 of IDR. 166.13 trillion, the amount of gyro IDR. 155.07 trillion, the amount of securities that are issued IDR. 276.32 billion. The role of the banking sector in mobilization of public funds for various purposes has been increased which is very large. The banking sector, which had previously not only more as a facilitator of the government and some large companies, has turned into very influential sectors of the economy. Once the importance of the role of banks and financial institutions, particularly in general, demanding the government through the Central Bank to perform guidance, direction and supervision to all the existing banks, both government banks, private national banks, foreign banks and the credit bank of people. In the mid 1980s various deregulation issued by the government to stimulate the life of the financial sector generally and the banking industry in particular has already started in 1988 through the Policy Package October 27, 1988 (PAKTO) deregulation of the banking sector. This policy covers areas of financial, monetary and banking. Policy in the field of banking, among others, include the ease of opening offices in banks, financial institutions and non-bank, approve the establishment of new private sector bank with the determination of capital requirements at least paid IDR 12.2 billion, also provides an opportunity to establish the Credit Bank of People (BPR) with the minimum capital IDR 50 million, and simplify the requirements for banks to become bank foreign exchange. After the release of deregulation is, in the period 1988-1996 the banking business in Indonesia experienced a very rapid development. At the end of 2000 banks around the 91.22% market shares in the financial sector. According to Bureau of Research Information Bank, the banking industry over 91.26

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percent market share in India's financial, insurance industry, followed by 3.11 percent, 4.12 percent of pension funds, industry, finance 3.11 percent, 0.77 percent securities, and pawnshop 0.51 percent, (Schmit, 2004). The rapid growth that was not able to encourage the creation of a strong banking industry. Financial crisis of Indonesia in the mid-1997 gave a very bad impact on the banking sector. Some of the key indicators in the banking sector in 1998 are located in a very bad condition. The performance of the national banking industry at that time far worse than the condition of banks in some Asian countries are also experiencing economic crises, such as South Korea, Malaysia, the Philippines and Thailand. Non Performing Loan (NPL) commercial banks reached 52 percent, the level of the banking industry profits are at the point minus 16.2 percent, and the Capital Adequacy Ratio (CAR) indicates the condition of minus 14.65 percent, (Hawkins, 1999). The banking sector due to the economic crisis forced the government to liquidate the bank is not considered healthy and is not feasible to operate. This resulted in the emergence of the crisis of confidence in the banking industry.

The Prime Indicators Assets

2000

Table 1. The Prime of Banking Indicators 2000-2009 (Rp Trilion) 2001 2002 2003 2004 2005 2006 2007

1.112,2

1.213,5

1.272,1

1.469,8

1.465,3

1.519,4

1.578,2

1.605,2

1.622,7

1.631,1

TPF

835,8

888,6

963,1

1.127,9

1.123,9

1.168,3

1.205.5

1.233,6

1.242,1

1.247,9

Credit

371,1

440,5

559,5

695,6

687,2

715,1

746,4

755,0

786,5

795,6

2008

2009

Source: The Indonesia Banking Statistics In short can be explained that the development of the Bank of Indonesia to the fluctuation. The looking at the conditions and problems in the Indonesian banking sector, after the rupiah's exchange rate crisis that followed the performance of economic decline in Indonesia 1997-1998. To restore the level of public confidence and the role of banks as institutions intermediaries, the bank required the performance of healthy intermediaries so that the process can run smoothly and the level of trust the community recovers. The performance of banks in the banking industry can be measured by the ratio of some financial reports.

Ratio

2000

2001

Table 2. Foreign Exchange Banks Ratio (%) 2002 2003 2004 2005 2006

CAR

23.33

22.90

22,44

19,43

19,42

19,39

16.21

15.36

13.35

11.43

NPL

4.87

4.54

3.46

4.78

3.22

3.09

3.56

3.98

3.08

2.88

LDR

37.77

38.21

38.24

43.52

49.96

59.66

63.22

63.89

65.44

66.21

ROA

1.44

1.67

1.96

2.63

3.46

2.55

3.66

4.44

3.51

4.78

ROE

53.30

55.48

56.76

58.22

60.08

62.33

66.21

69.55

75.66

78.82

EA

83.12

83.49

85.54

85.99

86.10

86.68

87.33

86.99

87.48

88.02

2007

2008

2009

Source: Indonesian Banking Statistics How to improve the financial performance of banks through the analysis of foreign exchange and non-foreign exchange strategy and productivity?. The variables that are limited by the author is to measure the performance of foreign exchange bank and non-foreign exchange banks during the financial period 20002009, based on financial reports quarterly publication of the Bank Indonesia. Discussion on the main performance indicator variables, namely banking, Capital Adequacy Ratio (CAR), Return on Equity (ROE), Loan to Deposit Ratio (LDR), Non Performing Loan (NPL), Earning Ability (EA) and Return on Asset (ROA).

Ratio

2000

2001

Table 3. Non-Foreign Exchange Banks Ratio (%) 2002 2003 2004 2005 2006

CAR

20.76

21.90

22,11

19,09

18,01

142

17,11

17.87

2007

2008

2009

16.32

15.45

14.32

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NPL

6.44

5.40

5.21

4.39

5.11

4.98

4.55

4.21

3.83

3.42

LDR

28.88

30.32

31.11

33.98

34.83

50.66

53.33

55.20

57.12

63.22

ROA

1.22

1.34

1.87

1.99

2.37

2.84

3.98

3.76

4.21

4.22

ROE

58.32

55.22

57.98

57.33

59.87

61.98

65.98

70.32

73.36

74.33

EA

80.23

82.33

83.98

82.87

84.11

85.44

86.44

87.93

86.32

87.77

Source: Indonesian Banking Statistics

THEORETICAL STUDY An organization, normally a corporation, chartered by the state of federal government, the principal functions of which are (a) to reserve demand and time deposits, honor instruments drawn against them and pay interest on them as permitted by law; (b) to discount notes, makes loans, and invest in government or other securities; (c) to collect checks, draft, notes and so on; (d) to issue drafts and cashier‘s check; (e) to certify depositor‘s checks; and (f) when authorized by a chartering government to act in fiduciary capacity. Definition of conclusions can be drawn that the bank is a business body that act as financial intermediaries in the economy, with the assertion that funds in the grouping is for the productive business sector with the aim of improving the standard of living many people. The main function of banks is to receive, among other savings, for example, in the form of savings and deposits, from the customers, to give interest in accordance with applicable law, collect on the check based on customer demand, providing credit, or embed the excess and reserve until needed for the payment of back. General bank in accordance with the Act No.10 Year 1998 is a bank conducting business activities in the conventional and syari‘ah principles based or in activities that provide services in the traffic of payment. According to (Bassett 2002; Kasmir 2003), the type of bank ownership in terms of views means is anyone who has a bank certificate of choice and control of shares owned by the bank concerned. Data banks in Indonesia from the years 2000 - 2009 listed in the Bank of Indonesia amounted to 128 banks. There are 26 foreign exchange banks and 28 non-foreign exchange banks as sample. Two different studies by Bassett and Brady (2001; 2002) examined recent performance of community banks. The 2001 study found that many small banks from 1985-2000 vanished through mergers and acquisitions. Increased competition with stock, bond and mutual fund investments may have weakened the competitive position of small banks. These community banks, nevertheless, were able to compete effectively against larger banks due in part to superior knowledge of local loan markets combined with a reluctance of customers to bank with out-of area institutions. Bassett and Brady‘s (2002) study found that small banks grew more rapidly than large banks from 1985-2001 with profitability remained at a high level. While interest costs increased, this was more than offset by higher returns on earning assets. Financial statement is the product of financial accounting process. This process is government by generally accepted accounting principle, which determines them information that is included, how it is organized, measured, combined, and finally how it is presented in the financial statement. ―American Institute of Certified Public Accountants, Accounting Principles Board (APB) Statement No.4, Basic Concept and Accounting Principles Underlying Financial Statement of Business Enterprises, AICPA, New York, 1970.‖ Performance can be measured with the bank to analyze financial reports. In analyzing financial statements, the financial performance of the basic tools used to predict the position and financial performance in the future. Some of the bank's performance is measured based on the financial ratio is Return on Assets (ROA), Return on Equity (ROE), Loan to Deposit Ratio (LDR), and the Capital Adequacy Ratio (CAR). Return on assets is the ability of banks to obtain a return on some assets owned by banks. Return on assets can be obtained with the ratio between the profits before taxes by total assets. Return on Equity indicator is the ability to manage capital in the banks that are available to obtain the net profit. ROE can be obtained by calculating the ratio between the profits after tax to total equity. Loan to Deposit Ratio indicator is the ability to pay in the banking community and all funds with their own capital to control the credit is distributed to the public. LDR can be obtained with the ratio between the total loans, with a total deposit. Capital Adequacy Ratio is the ratio that shows how large the number of all bank assets that contain risks (credit, including, securities, bank charges on the other) joined financed from their own capital in addition to obtaining funds from sources outside the bank. Bank of Indonesia to use CAR for the bank group level of health in addition to NPL (Bank of Indonesia, 2005). Bank's financial performance reflects the ability of banks operating in the field of union funds, funds, technology and human resources. Financial performance of the bank are the bank's financial condition during the period of the particular aspects of the union funds and funds that are usually measured by indicators capital adequacy, liquidity, and the probability a bank (Back et., al. 1996; Altunbas, 2001).

RESEARCH METHOD

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Objects used in this research are the publication of quarterly financial reports Public Private National Bank foreign exchange earned and non-foreign exchange earned from the Bank Indonesia. Period quarterly financial reports that are collected for 10 years, namely 2000 - 2009 in the form of balance sheet and profit and loss reports from the respective bank. In this research will use a sample of 54 private commercial banks national income. This study attempts to see the performance of the foreign exchange bank and non-foreign exchange bank. The sample is limited to the 30 fruit bank foreign exchange. Bank is selected based on quarterly financial report that foreign and non-foreign banks have been published by Bank of Indonesia during the period 2000 to 2009. The amount of data that is treated as assumed. Grouping presented the following criteria based on the bank of over 2000 - 2009. Analyze for 26 foreign exchange banks and 28 non-foreign exchange banks. Method used in this research includes qualitative and quantitative analysis of secondary data obtained from various sources. Data used in this research will come from the secondary data available to the public, such as data on the internet. In this research the author to obtain data such as financial reports from the bank through the Bank Indonesia www.bi.go.id site than through the site, the author conducted a study to strengthen the library and support the writing of this, namely disjoint theories that are required in the discussion of the problem. Done with and learn how to read books, literature, journals, and writings relating to the issues that will be examined. Variable is a concept that has many different values. The variables of this research, namely: Free variables are the variables that influence or for which the changes or the occurrence of bound variables. In this research consists of a variable-free. Return on Assets (ROA), Return on Equity (ROE), Loan to Deposit Ratio (LDR), Non Performing Loan (NPL), Earning Ability (EA). Bound variable is a variable that is affected or to become due, because of the variable-free. In this research the variables are bound, the Capital Adequacy Ratio (CAR). Test analysis tool that is used to test different test sample using a pair Wilcoxon and multiple regression.

ANALYSIS AND DISCUSSION Foreign exchange bank is a bank which can conduct transactions to foreign countries or related to the currency as a whole, for example, to transfer abroad, payment abroad, traveler‘s checks, and payment of Letter of Credit and other transactions. The requirements to become a foreign exchange bank are determined by Bank Indonesia. In the CAR test multi co linearity foreign exchange bank 2000-2009. Based on the table at the top of the CAR on bank shows that income does not have free variables that have a tolerance value less than 10%, which means there is no correlation between variables. The result of the calculation the value of variance Inflation Factor (VIF) also shows the same thing that is not a free variable that has a VIF value of more than 10, testing can be done in the Eigen value, where there is no variable-free approach 0 and the price on condition Index value does not exceed 15. Thus, not suspected of multi co linearity problem. So it can be concluded that there is no free multi co linearity between variables in the model. CAR at the foreign exchange bank 2000-2009 through Durbin-Watson value of 1.783, compared to the value (α = 0.05: n = 30 and k = 5) obtained dl = 1.21 and du = 1.66, because the DW> du (1783> 1, 66), it can be said in this model does not occur autocorrelation. Scatter plot graph of CAR on bank foreign exchange collection point does not appear to form a certain pattern. Thus it can be said that regression is not to crash so heteroscedastisity regression model used is feasible to predict based on the CAR that is free to enter the variables ROA, ROE, and LDR. Model 0.000 values significantly 2.89 from the F table value and significance 0000 2.89 and the significance values 0046